Wales Office Minister Stephen Crabb has been criticised after expressing the view that Wales is not underfunded.

Mr Crabb, the Conservative MP for Preseli Pembrokeshire, made the comment as he responded to a parliamentary question from Swansea West Labour MP Geraint Davies.

He suggested that a shortfall on the Barnett formula, which determines how much Treasury money comes to Wales, was offset by extra cash for projects like rail electrification.

A Welsh Government spokesman said: “It is of course the case that the UK Government spends money in Wales on non-devolved functions such as rail infrastructure.

“However, that does not alter the fact that the Barnett formula – which sets our budget for vital public services such as health and education – does Wales absolutely no favours. This has been demonstrated by the Holtham Commission and by numerous other independent studies.

“In their joint statement with us on October 24 2012, the UK Government said they ‘recognise that there has been convergence in Welsh relative funding since the start of devolution, and that this is a significant concern in Wales’.

“We have now agreed a process with the UK Government to reform the way Wales is funded before any further convergence occurs.”

Shadow Welsh Secretary Owen Smith said: “We were surprised to hear the Wales Office Minister disagrees with his colleagues in Cardiff Bay and indeed with colleagues at the Treasury, who recently acknowledged that convergence has occurred as a result of the Barnett Formula.

“Maybe Stephen Crabb is spending too much time in his other role as Government Whip to take a good look at the numbers affecting Wales.”

Plaid Cymru Treasury spokesman Jonathan Edwards said historically Wales had received just 2% of railway investment – less than half what it should have been.